Future growth in the biogas sector is likely to be seen in food waste plants, rather than those fed on manure and energy crops, a Rabobank report suggests.

Long-term drivers for the sector suggest that the technology is less of a renewable energy and more of a waste management solution for organic residues, the report said.

“Two factors dictate success for a biogas business case: the available supply of suitable feedstock and the forecast range for feedstock costs and ensuing yields,” said Rabobank analyst Clara van der Elst.

“This is more likely to be found in residuces from F&A (food and agriculture) processing – where the feedstock is proprietary and digestion lowers waste and wastewater fees, or where renewable energy subsidies lower costs, or a combination if found – than from manure, where you need to source other feedstocks to raise the energy yield.”

The bank expected a move away from energy crops towards residue streams from food and agriculture processing industries, she said.

Going forward, there was also scope for biogas to be used to meet EU transport fuel needs, as next generation biofuels were lagging behind growth expectations, she added.

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Gemma Mackenzie on G+